General Indices

by, James A. Hyerczyk The Australia 200 (AUS200) index CFD formed a 3-Point Extension Fibonacci Pattern on the 240-minute chart. The pattern suggests that a bottom may have formed at 4082.50. It also suggests that the index CFD may be poised for a retracement of the last swing down from Point B into the series of Fibonacci retracement levels. The 3-Point Extension Fibonacci Pattern is a counter-trend pattern. Traders should be able to recognize the basic “ABC” or “lightening bolt” pattern present in all Fibonacci Patterns. Compared to the 3-Point Retracement Fibonacci Pattern, this one clearly defines a downtrend whereas the other forms a higher bottom. After forming the last bottom, the market is expected to retrace the last move down into a series of Fibonacci retracements levels ranging from .382 to 1.618. This pattern may be attractive to both trend and counter-trend traders. Trend traders may use the information to exit their already established short positions in anticipation of a retracement. Rather...

by, James A. Hyerczyk After forming a support base on the 30-minute chart, the STOXX50 Index CFD broke out to the upside through the resistance line of pennant chart pattern. In what could be the start of a counter-trend rally because of the size of the recent sell-off, the market could be poised for a rally into the Autochartist target zone at 2192.47 to 2230.22. The overall quality of this chart pattern is an impressive 9-bars. The initial trend which was up prior to the start of the formation is a solid 9-bars. This indicates the trend was strong before the recent break. The uniformity indicator measures the number of touches of support and resistance. It also looks for the presence of equidistant tops and bottoms. This indicator is rated the maximum 10-bars. The clarity rating is an above average 7-bars. This demonstrates the absence of substantial “market noise” and represents a relatively “clean” chart pattern. The pennant chart pattern is a non-trending...

by, James A. Hyerczyk The Japan 225 (JP225) index CFD broke sharply into the close on Friday, penetrating the support line of a triangle chart pattern and triggering the start of a possible break into the Autochartist target zone at 8366.13 to 8327.12. The overall quality rating is 7-bars. The initial trend was down prior to the chart pattern formation and the low 3-bar rating is considered weak. The uniformity indicator looks for equidistant tops and bottoms. In addition, it grades the chart pattern based on the number of touches of support and resistance. A high or above 7-bar rating suggests a number of successful tests. On this chart, it looks like support was tested numerous times. The clarity rating is based on the amount of market noise present during the chart pattern’s formation. The 9-bar rating suggests a “clean” pattern has been formed. The triangle chart pattern is a non-trending pattern. The narrowing of the support and resistance lines typically compresses the...

by, James A. Hyerczyk The Germany 30 (GE30) index CFD broke through Autochartist key level support on Thursday, setting up a possible move into the forecast zone identified as 5683.13 to 5514.18. Not only did the market break through support, but two closes under the key level suggest there is mounting selling pressure. The significance of the support key level is only an average 5-bars. However, the length of the chart pattern is most important in this case. The 238-candlestick formation indicates that this pattern has developed over a relatively long period of time. Typically the longer it takes a pattern to develop, the more significant the move once the key level support is violated. When working with breakouts through key levels, it is important to watch for momentum at the time of the break. The stronger the momentum the more conviction behind the trade and the more likely it will continue toward a forecast area. Not only is the penetration of a...

by, James A. Hyerczyk The France 40 (F40) Index CFD broke through with a vengeance the rising support line of a triangle chart pattern on the 30-minute chart. The size of the last candlestick is a strong indication of heavy momentum and selling pressure. Traders playing the short-side want to see this momentum continue to drive this market into the Autochartist forecast zone at 3020.10 to 2982.44. The overall quality of the chart pattern is rated an above average 6-bars. The initial trend which measures the strength of the trend prior to the pattern’s formation is an average 5-bars. The uniformity indicator looks for equidistant tops and bottoms as well as measuring the number of touches of the support and resistance lines. Despite what looks like a number of successful touches of the support line, the uniformity rating is only an average 5-bars. The 9-bar clarity rating means the chart pattern is “clean” and without any noticeable “market noise”. The triangle chart pattern...

by, James A. Hyerczyk The E-mini Dow Futures contract crossed a resistance key level at 12091.50, signaling a possible breakout to the upside. Like any breakout trade, this pattern will need momentum in order to succeed in reaching the Autochartist forecast zone at 12283.65 to 12553.90. The first sign that this market may have to regroup before making another attempt to move higher was the lack of follow-through to the upside after the initial penetration of the resistance level. Since old resistance tends to become new support, the second sign of weakness was the break back under the resistance line. Without momentum the E-mini Dow can either begin a sizeable retracement to the downside or continue to straddle the resistance line until acted upon by a strong force. When considering whether to trade a breakout to the upside, the first thing the trader has to do is consider the strength of the momentum moving into the breakout level. This is known as “hitting...

by, James A. Hyerczyk When using the new Autochartist Key Levels trading tool, a trader has to be aware that the driving force behind the breakout is volatility or momentum. Not only is it needed to trigger the strength of the breakout, but it also must be present throughout the move to drive the market into the Autochartist target zone. Since old resistance often becomes new support according to most market technicians, a trader must be aware that once a market breaks out to the upside that the breakout level becomes the new support. This rule is most often followed by volatility-based traders. In other words, a trader who buys a breakout is saying “a trend in motion is likely to remain in motion”. Another expression used by technicians is “you go home with the girl you went to the dance with”. This means that if momentum is what made you enter then a change in momentum is what is going to...

by, James A. Hyerczyk After building an elongated support base, the Italy 40 (IT40) index CFD finally broke out over the downtrending resistance line belonging to a triangle chart pattern on the 240-minute chart. Although there is one more barrier to overcome, there appears to be enough upside momentum to drive this market into the Autochartist forecast zone within a reasonable time period. The overall quality rating is an above average 6-bars. The initial trend which was up at the start of the pattern is a weak 4-bars. The strong 7-bar uniformity rating indicates the presence of equidistant tops and bottoms. The clarity indicator measures the amount of market noise present during the pattern’s development. The high 8-bar rating indicates a “clean” pattern has been formed without many disruptive “spikes” or gaps. The triangle chart pattern is a non-trending pattern. The gradual narrowing of the support and resistance lines almost pinpoints when the market is likely to begin its breakout. The maximum 10-bar...

by, James A. Hyerczyk The Spain 35 (ES35) index CFD breached the Autochartist key level support signaling a breakout to the downside on the 60-minute chart. Although follow-through selling did not transpire on the initial penetration, traders should continue to watch the level at 8286.00 for renewed momentum that will cause the market to move away from the broken level. Should downside momentum re-emerge then traders should look for a break into the forecast area at 7839.80 to 7222.80. Autochartist’s innovative horizontal support level quickly catches the eye of traders and should be interpreted as an area that could attract additional selling pressure. Like any breakout trading technique, momentum will be needed to drive the market into the downside objective. Because it is momentum based, a trader will know almost immediately if enough sellers are present to drive the market lower. This eliminates the need for excessive or wide stops and is well-suited for the short-term or scalp-type trader looking for a...

by, James A. Hyerczyk After another day of volatile up and down action, the Germany 30 (DE30) index CFD finally decided on a direction as evidenced by its solid breakout through the support line of a triangle chart pattern on the 240-minute chart. If downside momentum continues, this index CFD should reach the Autochartist target zone at 5679.45 to 5504.38 over the near-term. The overall quality of this chart pattern is a slightly above average 6-bars. The initial trend which was down prior to the formation of the chart pattern is a below average 3-bars. The uniformity indicator looks for equidistant tops and bottoms and measures the number of touches of support and resistance. This quality indicator is rated 6-bars. The clarity indicator is rated a solid 8-bars. This indicator looks for gaps and spikes. A high rating suggests the absence of disruptive market noise. The triangle chart pattern is a non-trending pattern. Typically the support and resistance lines compress during its formation,...